The Effect of Divorce on Business Ownership

Parting ways with your spouse after speculating a “happily-ever-after” life can be hard, and having a business together complicates the divorce process. Usually, the judge handling the case makes the decisions in the distribution of marital property to avoid future problems. However, you can choose to get a family law defense attorney in Lynnwood, WA for a fair distribution of marital property before taking the matter to court.

When a business is a marital property

First, if any or both spouses own a business, the business qualifies as marital property. Marital property in the form of a business is likely to go through the following during divorce:

Dissolution

The first and most preferred option is to close down the business and share the business’ assets and liabilities according to the share value in the business. The parties should divide any debt that the business owes.

Splitting and compensation

In some instances where one spouse wants to keep the business, the other party should receive an amount equivalent to their share of value. The “leaving” party can choose to substitute his or her shares in the business with other marital assets such as house, car, or land.

Can a business survive divorce?

Regardless of the assets you own as a couple, there is always a way to rightfully divide the assets for the sake of a peaceful divorce settlement agreement. Furthermore, the process of dividing the assets becomes easier if both of you come clean about all the details of your assets at the beginning of the litigation process.

Starting and building a business takes a lot of commitment, patience, and resources, and divorce is not a reason to let all the input go down the drain. If you are considering a divorce, and are a business owner, it is important to protect your financial assets with the help of a family law attorney. The attorney also ensures that the involved parties respect each other’s rights and privileges.